ARE

Alexandria Real Estate Equities Inc

Finance/Real Estate


Presented:03/16/2017
Price:$109.87
Cap:$8.88B
Current Price:$121.20
Cap:$21.20B

Presented

Date03/16/2017
Price$109.87
Market Cap$8.88B
Ent Value$13.71B
P/E RatioN/A
Book Value$53.37
Div Yield0.03%
Shares O/S80.80M
Ave Daily Vol693,422
Short Int3.44%

Current

Price$121.20
Market Cap$21.20B
Alexandria Real Estate Equities, Inc. operates as a real estate investment trust, which engages in the development through ownership, operation, management, selective acquisition, development, and redevelopment of properties containing life science laboratory space. It also provides real estate, technical infrastructure, and services to the diverse life science industry. The company was founded by Joel S. Marcus and Jerry M. Sudarsky in June 1994 and is headquartered in Pasadena, CA.

Publicly traded companies mentioned herein: Alexandria Real Estate Equities Inc (ARE), Blackstone Group LP (BX), SL Green Realty Corp. (SLG), Vornado Realty Trust (VNO)

Highlights

The presenter is long shares of Alexandria Real Estate (ARE), which is the only public real estate investment trust (REIT) dedicated to the laboratory space. ARE’s specialty is office space for life sciences companies. These tenants typically require higher floor loads, better HVAC systems, etc. for drug development or other research purposes. It counts a number of the top pharma and biotech companies as its tenants, and the triple-net lease structure and high barriers to exit provide for stable cash flows (he noted that roughly half of revenue is derived from investment grade tenants). Looking out to 2018, the presenter is forecasting $7 of FFO/ share (~5% ahead of Street estimates), and applying a 20x multiple gets him to a $140 price target for a 27% gain (not including a 3% yield) in 12-24 months.

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Idea Discussion

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